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in Novato, CA
Most Novato self-employed borrowers get turned down by conventional lenders. Their tax returns show too little income after deductions.
Two non-QM options solve this: 1099 loans and bank statement loans. Knowing the difference saves you time and money.
1099 loans are built for independent contractors and freelancers. Your 1099 forms — not your tax returns — prove your income.
Lenders typically average 1-2 years of 1099s. This works best when your gross 1099 income is high and consistent.
Bank statement loans use 12 to 24 months of deposits to calculate your income. Lenders apply an expense ratio to your deposits.
This approach works for any self-employed borrower — not just 1099 earners. Business owners with LLCs and S-corps qualify too.
The core difference is how income is documented. 1099 loans use your gross earnings from 1099 forms. Bank statement loans calculate income from your actual deposits.
Bank statement loans typically offer more flexibility. They serve a wider range of business structures. 1099 loans are narrower — they work best for pure contract workers.
You're a good fit for a 1099 loan if you're a freelancer or contractor with strong gross 1099 income and minimal business expenses.
Bank statement loans make more sense if you run a business, write off significant expenses, or have income that doesn't come from 1099s. In Novato, where home prices run high, maximizing your qualifying income matters.
Bank statement loans handle mixed income better. They capture all deposits, not just 1099-sourced income.
Most non-QM lenders want at least 10-20% down. Exact requirements vary by lender and borrower profile.
Yes. Non-QM loans carry higher rates than conventional. Rates vary by borrower profile and market conditions.
Most lenders want at least 620-640. Stronger scores get better pricing on both loan types.
Timelines are similar. Having clean bank statements or 1099s ready upfront speeds up both.
Yes. Lenders can blend W-2 and 1099 income. A bank statement loan may still qualify more income overall.